Analyze the data and comment on which company you chose Barc

Analyze the data and comment on which company you chose, Barco or Kyan, that (1) has the better short term position, and which company (2) would be the better investment. Include references to the specific data you calculated for comparrison that would support your responce. The response should be a couple paragraphs long. Do not use dollar amounts, use ratios. I included the answers for number four and five that you should go by.

4 The following information applies to the questions displayed below Summary information from the financial statements of two companies competing in the same industry follows. 5790,000 $895,28ee 589,100 6461500 Sales Assets Cash 5 21,000 32,000 Cost of goods sold 7,900 10,000 177,815 213,986 3.93 Current notes receivable (trade) 9,400 8,800 Income tax expense se i 84,540 138,500 Net income Basic earnings per share per share 4.68 3.74 5,600 7, Prepaid Plant assets, net Total assets Liabilities and Equity s 26,800 s 561200 s 61,340 19,300 Current notes receivable (trade) 79,800 99,000 190,000 196,000 Total assets 16480 154,85 Common stock, $5 par value $495,940 $55,150 Retained earnings 61,600 1091400 428,000 412,s0e 190,000 1961000 129,105 94,920

Solution

5) a) Profit margin ratio:Net Income/Net Sales BARCO 177815/790000 0.23 KYAN 213986/895200 0.24 b)Total Asset Turnover : Net sales / Average Total assets BARCO 790000/495940 1.59 KYAN 895200/550150 1.63 c) Return on total assets: Net Income / Average total assets BARCO 177815/495940 0.36 KYAN 213986/550150 0.39 d)Return on Common Stockholder\'s Equity : Net Income / ending comm stockholder\'s equity BARCO 177815/190000 0.94 KYAN 213986/196000 1.09 e)Price Earning ratio : Market price / EPS BARCO 90/4.68 19.23 KYAN 90/5.46 16.48 f) Dividend yield : cash dividend / Market price BARCO 3.74/90 0.042 KYAN 3.93/90 0.044 The better Investment : barco is better because having higher beta and best results in operations.